Bob Diamond, the chief executive of Barclays bank, has been summoned before the Treasury Select Committee on Wednesday as the Government announced an independent review into the future of the banking industry.
The review will consider the future operation of the Libor rate and the possibility of introducing criminal sanctions, a Treasury source said.
This week, the banking industry has become embroiled in a number of scandals surrounding improper trading and manipulation of interest rates.
Barclays traders were revealed on Tuesday to have manipulated the Libor rate, the interest at which banks trade to each other.
Previously, Ed Miliband has called for a full-scale public inquiry into banking culture and practices.
The Labour leader said the industry was plagued by an "institutional corruption" which could only be eradicated by introducing a tough new code of conduct and jail sentences for immoral bankers who abuse the system.
His comments were echoed by Bank of England Governor Sir Mervyn King who demanded a "real change in culture" as Britain's lenders were left reeling following a week blighted by controversy.
Sir Mervyn said he believed a Leveson-style inquiry was not needed, but condemned conduct in the industry.
The prime minister, David Cameron, refused to back Diamond, saying the bank leader had "questions to answer".
Earlier on Saturday, Justice Secretary Ken Clarke called for criminal investigations in improper conduct at banks.
MPs on the Treasury Select Committee will grill Mr Diamond over who at Barclays knew about the Libor "scam" and how the issue had been dealt with.
The committee has also asked the bank's chairman Marcus Agius and other non-executives to appear on Wednesday.
Committee chairman Andrew Tyrie, a Conservative MP, said: "The Libor interest rate benchmark - crucial to transactions right across the economy and affecting millions of people - was systematically rigged over a period of years.
"It appears that many banks were involved and Barclays were the first to own up. This is the most damaging scam I can recall.
"The reputation of Britain's financial services industry has been severely tarnished, albeit unfairly for the overwhelming majority unconnected with the scam.
"The public's trust in banks has been even further eroded. Restoring the reputational damage must begin immediately.
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